Dear Editor,
I refer to the letter of M. Xiu Quan-Balgobind-Hackett captioned “About 32% of my income goes to combined taxes” (07.12.14) and thank him for pointing out that as people’s incomes rise above the minimum wage threshold of G$28,000 per month their rate of “combined taxes” would increase as well. Also, the way people spend their monies would change as well.
It is refreshing to hear that you pay 32% in combined taxes on your income. Not the taxes part, but the fact that you have actually worked out for yourself what you are paying in taxes.
Prehaps you could consider working out the situation in USA, Canada, Barbados and Trinidad so Guyanese can assess the taxation in these countries compared to Guyana? I am not in a position to do this as I do not have the relevant information.
I suspect the problem in Guyana is not a wage issue in as much as it is a productivity issue. Productivity needs to be raised which would help employ more people leading to a further rise in productivity and better pay.
However, when Guyanese expect at least a 5% salary increase each year (without pushing up productivity) inflation is pushed up eroding the value of the wage increase. It is in Guyanese interest to keep inflation to below 1% which normally means getting out of the mentality of asking for pay rises every year. Will this be done? I seriously doubt it.
I suspect that the Government would use the amount collected by VAT@16% to lower the income tax of 33.33% to 30%. And, it may increase pensions as well.
Yours faithfully,
Sean Brignandan
